Fuel Surcharges Soar, Japan's Summer Holiday Overseas Travel Declines for First Time in 6 Years

TOKYO (CNA) -- Japan's travel industry is bracing for a downturn in overseas travel during the upcoming summer holiday period, with the number of Japanese travelers expected to decrease by 9% compared to last year, marking the first decline in six years, according to a forecast released today by travel firm JTB.

Industry experts attribute the drop in outbound travel to the continued depreciation of the Japanese yen and a significant increase in airline fuel surcharges, which are dampening the willingness of Japanese citizens to travel abroad.

According to the Nikkei, JTB's forecast for the July 15 to August 31 period estimates approximately 2.17 million Japanese travelers will go abroad. While the overseas travel market had seen five consecutive years of recovery, it has not yet returned to pre-pandemic levels. An analysis of consumer surveys, travel agency sales, and airline bookings indicates that fuel surcharges and exchange rates are the two most significant factors influencing travel this year.

Both All Nippon Airways (ANA) and Japan Airlines (JAL) have announced increased fuel surcharges for tickets issued in July and August. For routes between Japan and Europe, passengers will have to pay 65,000 yen (approximately NT$13,000) per person, more than double the amount charged for tickets issued in April. Fuel surcharges for flights to Hawaii have also nearly doubled in just two months. As these surcharges apply to all passengers occupying a seat, regardless of age, the cost of family vacations has increased substantially.

Hideo Shioya, a professor at Kokugakuin University specializing in the tourism market, explained, "In addition to the continued depreciation of the yen, fuel surcharges typically reflect oil prices with a delay of several months. This current surge in prices coincides precisely with the peak summer travel season, significantly weakening people's desire to travel."

Japanese travel companies report a decline in demand for popular family destinations like Hawaii and Guam compared to last year. Surfjack Hawaii, a hotel operated by Hoshino Resorts in Hawaii, also noted a significant decrease in Japanese tourists compared to pre-pandemic levels, particularly among families with children.

On the other hand, the average spending on overseas travel continues to set new records. A survey found that the average Japanese traveler will spend 323,000 yen on overseas trips this year, a 6% increase from last year and a historic high.

Faced with escalating travel costs, travelers still wishing to go abroad are adjusting their destinations, shifting from long-haul routes to Europe and North America towards Asian destinations accessible by low-cost carriers.

Japanese travel agency HIS reported an increase in popularity for destinations with direct low-cost carrier flights, such as Da Nang, Vietnam, and Cairns, Australia. KNT-CT Holdings' Club Tourism noted a rise in demand for Southeast Asian countries like Thailand and Indonesia, indicating a market shift towards shorter-haul, more affordable destinations.

A 27-year-old female office worker in Tokyo, who had originally planned a summer trip to the Grand Canyon in the United States, decided to change her destination to Hong Kong due to the surge in fuel surcharges. She commented, "I was aware of the yen's depreciation, and there's nothing that can be done about it, but I never expected the fuel surcharges to become so high."

JTB also suggested that the robust travel during this year's Golden Week (GW) holiday period may have contributed to the decrease in overseas travel during the summer. Many individuals who traveled abroad during Golden Week may have opted to forgo a summer trip.

Regarding the European market, JTB forecasts only a 1% decrease in the number of travelers to Europe this summer compared to last year. Despite recent heatwaves in Europe causing over 2,000 deaths, there has been no significant impact on travel demand. Travel agencies analyze that those traveling to Europe are often high-income individuals less affected by exchange rates and prices, thus the market impact is relatively limited.

In addition to the cooling of overseas travel, the domestic travel market in Japan is also being affected by rising prices.

JTB estimates that domestic travel during the summer holiday will reach approximately 69 million people, a 4% decrease from last year. The average per-person travel cost is expected to increase by 3% to 48,500 yen. Furthermore, the proportion of people who will "not travel at all" during the summer has increased by 3.6 percentage points to 69%, reflecting how high prices and escalating travel costs are significantly suppressing the travel consumption intentions of Japanese citizens. (Editor: Tian Rui-hua) 1150702)